The Convention Peoples’ Party says a government that spends more on repaying loans than it spends on growing food is incompetent.
The CPP is alarmed that Agriculture has severely shrunk from 5.7% in 2012 to 0.04% in 2015, a year in which government paid more on interests on loans than it has budgeted for.
“The government used a whopping GHC390.52 million in financing loans while it committed only GHc 27.04 million to Agriculture”.
“If this is not evidence of a misplaced priority, then it is a sign of incompetence”
The CPP’analysis were contained in a response to government’s 2016 budget tatement presented to Parliament on 13 November 2015.
The party says government’s borrowing spree is starving the economy of the much needed investments in productive sectors of the economy.
According to the CPP, the size of Ghana’s economy is only 30% of what it used to be in 2011. In effect, the economy has lost 70% of its weight in 2011.
“Our GDP growth rate, which stood at 14% in 2011, but has fallen to a b an average performance of 4% in 2015”
Read full statement
2016 BUDGET- A HOAX AGAINST THE PRIORITIES OF THE NATION – CPP
Fellow Citizens, hardworking people of Ghana,
A budget must match the priorities of the nation. And the leading priority of our dear nation, Ghana, is a plan for the future – a plan for decades to come, a sustainable plan to increase the living standards of all Ghanaians.
A plan to build beyond agrarian agriculture and oil boom, a plan to make Ghanaians confident again.
Our people and our nation are creative, caring, imaginative, optimistic, productive and adaptive. But the Budget Statement and Economic Policy of the Government of Ghana for the 2016 financial year presented to Parliament on Friday, 13th November 2015, by Mr. Seth E. Terkper has neither the qualities nor the priorities of the Ghanaian people.
Ghanaians awaited this Budget statement in FEAR, ANTICIPATION and HOPE.
FEAR – that the lack of vision and cruelty of past Budgets would be repeated.
ANTICIPATION – that it might not.
HOPE – that the Government would, at last after SIX years, get the national economic agenda right.
But once again, in every way, this Government led by H.E. John Dramani Mahama let Ghana Down. The test for this Budget was to plan for the future: to increase public and private sector productivity, to create employment/JOBS, to boost capital investment, to increase confidence for the years and decades ahead.
To restore the broken hope. But this Budget fails every test. It is a hoax, a whitewashing, and a barrel full of empty and hopeless promises.
To the extent that the Minister of Finance pretends this Budget is in any way a solution to our dwindling economic fortunes, it is a total hoax.
Does it return Ghana to paths of economic prosperity next year, in the medium term or even the long future? NO.
Does it smooth our economic transition into a so called middle income state? NO.
Does it deal with the real challenges of our economic needs, the challenges of new skills and jobs? A big NO.
Provide a basis to industrialize our commodity backed economy
Deepen our engagement with the rest of Africa
Advance equal treatment for our women
Create an enabling environment for entrepreneurship
Provide policies to clean and improve Public Sector growth and efficiency
Provide jobs for the teeming unemployed youth
Provide the enabling environment to get Ghana working again
It is all NO.
The Budget Statement is nothing short of the works of a very desperate make-up artist – the International Monetary Fund (IMF).
It is therefore not very surprising though highly terrifying that this budget pays no serious attention to job creation and industrialization.
REAL GROWTH AND MISSED TARGETS
In 2011, Ghana was touted as the second fastest growing economy in the world. This achievement fell flat when the economy began to slump. Our GDP growth rate, which stood at 14% in 2011, but has fallen to a b an average performance of 4% in 2015. Thus, Ghana’s economic growth rate has contracted by over 70%.
From 2012 to 2015 real GDP growth rate DECREASED from 9.3% to 4.1%.
Growth in the Agricultural sector, our ECONOMIC BACKBONE, DECREASED from 5.7% (2013) to 0.04% (2015).
Growth in the Services sector too DECLINED, from 10% (2013) to 4.7% (2015).
But growth in the Industrial sector INCREASED from 6.6% (2013) to 9.1% (2015).
The distribution of GDP has been as follows:
Agriculture from 31.8% (2009) to 19% (2015)
Industry from 19% (2009) to 26.9% (2015)
Services from 49% (2009) to 54.1% (2015)
This means that the Services sector is still the leading sector, while the Agricultural sector continues to decrease in size without increase in productivity and transformation.
The government failed to meet previous real growth targets but is not shameful and hence confidently projects a GDP growth of 5.4 percent for 2016 and 8.2 percent in the medium term.
Accepting that the government is able to grow the economy by 5.4 percent, it will take approximately 13 years to double our 2014 GDP of a paltry 38.65 billion dollars. If this is not failure and a lack of vision, then what else can it be?
The CPP has over the years advised about the need to pay critical attention to our industrial sector if we really want to “transform lives”. This vision is actually lacking in this Budget as the government demonstrated that it was more committed to paying monies owed IMF and other lenders than investing in Ghana.
The government used a whopping GHC390.52 million in financing loans while it committed only GHc 27.04 million to Agriculture. Interestingly, the government managed to go beyond budgetary limits to meet interest payments while spending less than budgeted on the Agriculture and other productive sectors.
If this is not evidence of a misplaced priority, then it is a sign of incompetence.
It is also misplaced to spend GHc135.95 million in 2015 on improving the capacity of teachers, supplying teaching and learning materials, etc., with no reference to technical skills acquisition. Contrast it with creating a Debt Service Fund of $ 179.81 million.
HIGH DEBT LEVELS TODAY WILL BURDEN FUTURE GENERATIONS
Fellow Ghanaians, the appetite of the NDC government for borrowing is not only a danger to us today but also a heavy burden for our unborn generations. It is never acceptable for a Finance Minister to tell us that public debts stands at GHc92, 161.84 million, representing 69.12 % of GDP.
If we fail as Ghanaians to show this government the exit in 2016, our woes cannot be quantified. We will not be shocked if the country is declared HIPC a second time because Ghana is heavily indebted but is being covered and shielded by the IMF until the economy crumbles, since the center is not holding.
The level of fiscal indiscipline is outrageously high and cannot be accepted. The Minister speaks of designing a fiscal policy that consolidates the gains made. But we are asking, where are the gains? Were they made here in Ghana or only on the books of IMF?
It is good the Minister acknowledges the need to safeguard the future of this great nation but it is not sufficient to only acknowledge; hard work and commitment must be demonstrated.
The 2016 Budget is a repackaged expired 2015 Budget. A Budget that has already passed its “Sell by Date”.
This Budget statement is not different from the previous Budgets presented by the Finance Minister. Nothing really has improved, rather conditions have worsened.
The 2015 Budget had:
A budget deficit
Was dependent on taxes
No clear guide to restore macroeconomic stability
Cuts in funds to productive sectors.
The 2016 Budget has the same bad qualities.
THE WAY FORWARD IS CPP
Not only are Ghanaians tired with of a failed, corrupt and incompetent NDC, but Ghanaians cannot trust the future of our dear nation into the hands of the Structural Adjustment Policy Parties (SAP), the NDC and NPP, who are backed by a failed neo-colonial tool, the IMF. The way forward is not wholesale trade liberalization as being trumpeted by the SAP parties. Neither is it a service sector led economy.
The surest way to secure the economic future of our country is to return the CPP to POWER. The CPP is the only party committed to the decolonization of our economy through industrialization by making strategic investments for a transformation of lives.
A CPP government will:
Transform Food and Agricultural raw material production by linking them to processing plants to restart the industrialization of the economy that was halted by the coup of 1966.
Protect our manufacturing sector for capacity development to enable our companies and products compete internationally.
Develop our productive resources to substitute for imports and decrease our trade deficits.
Diversify the agricultural export commodity sector to increase export earning as well as to enable us to withstand shocks.
Additionally, we need to develop synergies between the oil and gas industry and the manufacturing sector for sustainable growth and a secured future for our beloved country.
#CPPGOVTNOW! IT’S TIME!
God Bless Our Homeland Ghana
Nii Armah Akomfrah